IndusInd Bank shares in focus after SEBI insider trading order on top management officials

IndusInd Bank Ltd., the Mumbai-based private lender will see its shares react to the market regulator SEBI's order on insider trading against its former top management officials, which was released on Wednesday evening.

All five key management personnel (KMPs), including former MD & CEO Sumant Kathpalia, former deputy CEO Arun Khurana and three other officials, have been barred from buying, selling or dealing in securities, either directly or indirectly, in any manner whatsoever, until further orders.

The SEBI order also stated that no deposits or debit can be made in the bank accounts of these former officials, without permission of the market regulator.

These five officials will not dispose of or alienate any of their assets or properties until the impounding amount is credited to the fixed deposit accounts and the market regulator has also asked the officials to provide a full inventory of all their assets.

IndusInd Bank had reported a net loss of over ₹2,300 crore for the March quarter as a result of the accounting issues within the derivative portfolio and stress within the microfinance book.

Brokerage firm JPMorgan on Wednesday had downgraded the stock and also cut its price target by 50% to ₹550, which is among the lowest on the street for the lender and also below its current 52-week low.

Out of the 47 analysts that have coverage on IndusInd Bank, 22 of them now have a "sell" rating on the stock. 15 analysts have a "hold" recommendation, while 10 of them still have a "buy" rating.

IndusInd Bank's shares had ended 2% lower on Wednesday at ₹804.9, having recovered more than 33% from their 52-week lows. Despite this, the stock is down 17% on a year-to-date basis so far.

(SEBI Order Story by Ritu Singh.)